The coronavirus crisis and lockdown have paralysed businesses and left many in South Africa without an income.
In view of the Presidents declaration of the National Disaster on 15 March 2020 in respect of the current COVID-19 pandemic, the Minister of Employment and Labour has issued a Directive called the COVID-19 Temporary Employee / Employer Relief Scheme (C19 TERS).
C19 TERS is a special benefit created under the Unemployment Insurance Fund to cater for situations where it will not be economically possible to pay employees as a consequence of the lockdown.
What is TERS?
TERS is a special benefit created for under the UIF and aims to provide emergency relief to employers so that they may continue to pay their employees during a temporary lay-off.
The benefits under TERS are available to an employer who closes its operations due to the COVID-19 crisis for a period of three months or less and as a result are in financial distress.
What is UIF?
The Unemployment Insurance Fund (UIF) gives short-term relief to workers when they become unemployed or are unable to work because of maternity, adoption leave, or illness. It also provides relief to the dependants of a deceased contributor The Unemployment Insurance Fund has introduced a special new coronavirus benefit, aimed at workers affected by the pandemic crisis. Employers need to apply for the coronavirus benefit if they can't afford to pay their workers.
When a contributing worker becomes unemployed; is unable to work due to sickness; or go on maternity leave, they can claim benefits from the UIF. You can also claim if your employer decides to cut your hours (this is called the “reduced working time” claim).
Government has now also introduced a special new coronavirus benefit, aimed at workers affected by the pandemic crisis.
If an employer has no choice but to close its operations during the lockdown, an employer has the option to temporary lay-off employees. This means that the employees will not receive any income for the duration of temporary lay-off.
Another option available to employers is to implement reduced working hours leading to the employee only receiving part of his/her monthly income.
Qualifying criteria for TERS
The company must be registered with the UIF;
The company must comply with the application procedure for the financial relief scheme; and
The company’s closure must be directly linked to the COVID-19 pandemic.
How much can your employees get?
The amounts paid will be a percentage of an employee’s salary, according to a legislated sliding scale from 38% (highest earners) to 60% (lowest earners).
The maximum is R6 730 a month. The sliding scale stops at R17 702: All workers earning more than this will only get the 38% maximum benefit (R6 730). The minimum amount will not be below the minimum wage (around R3 500).
It works on the same principle as maternity benefits. If a company can still afford to pay employees a part of their salaries, the TERS money will “top up” these payments – but employees can’t earn more than 100% of their current salaries.
The COVID-19 virus has been declared an occupational disease. This means that if an employee is absent from work due to contracting the virus during the course and scope of his/her employment, such leave will be covered in terms of the Compensation for Occupational Injuries and Diseases Act (“COIDA”).
If the COVID-19 virus was not contracted during the course and scope of employment, leave taken will be considered as sick leave.
The employee must give written notice of the disease to his/her employer and to the compensation commissioner and follow the process in place. However, there is also an illness benefit that can be claimed from the UIF if the employee and the employer agreed to the employee being placed under a 14-day quarantine period. If this is the case, the claim must also include proof of this agreement between the employee and employer.
- Confirmation from both the employer and the employee must be submitted together with the application as a proof that the employee was in an agreed pre- cautionary self -quarantine for 14 days.
- Should an employee be quarantined for more than 14 days, a medical certificate from a medical practitioner must be submitted together with continuation form for payment.
How can we help Employers?
- We confirm with the department of labour if the company is registered with UIF
- Register companies on U-filing
- Collection of all relevant documentation from Employers
- Application for TERS benefit
- Ensuring all required documentation from Employers are completed correctly
The information shared on this article/blog/vlog should be read and understood within the current legal framework of South Africa. It is meant purely for educational discussion and does not amount to legal advice. For specific legal advice, please consult a legal practitioner prior to application.